Mortgage Rates Fall to Fresh Historic Record Lows
Mortgage rates fell again this week to fresh record lows, according to data released today by Freddie Mac. The 30-year rate fell to 3.91% (see chart above), the 15-year rate dropped to 3.21% and the one-year ARM is down to 2.77%, and those are all the lowest rates in history. How low can they go?
7 Comments:
"how low can they go?"
well, i suppose that has to do with how much money the federal government is willing to have freddy and fannie lose, no?
these seems like a very inelastic demand curve. rates keep dropping dramatically while new applications and refis make lows for the year as well.
am i the only one to whom this seems like bigger hammer theory?
they just keep cutting rates hoping to spark demand, but if rates were the issue, one would expect you'd be seeing some sort of response by now.
Great time to buy a house. More affordable than ever---huge market of buyers developing.
If the Fed can signal growth, we may see a sustained secular boom in real estate.
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People do not make 15 to 30 year commitments in an environment of instability and uncertainty. This is true of businesses as well. The lack of investment, of all sorts, reflects the degree to which the current administration has darkened the future outlook with the prospect of massive tax increases and out of control regulatory costs. The housing market will not improve substantially until the politians deal with our long term structural problems in a meaningful way.
i'd be interested to see what the losses at freddy and fannie would be if demand for mortgages went back up to normalized levels at these rates.
i suspect you'd be looking at $200+bn a yr in losses. (they are losing 60bn now)
Well Joel Kotkin writing in New Geography notes one of the possible effects of new, lower mortgage rates in this commentary: THE SUN BELT'S MIGRATION COMEBACK
This would be a great story if anyone could get approved for a mortgage.
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